Citizens downgraded Reddit to Market Perform from Market Outperform after its latest quarterly results, citing uncertainty over user growth as Google sends less traffic to the platform. Although third-quarter results beat analyst estimates, shares fell sharply after Reddit issued a weaker-than-expected revenue outlook and warned that search referral declines were accelerating, dropping about 25% shortly after the open on Friday. U.S. daily active uniques fell 5% sequentially in the third quarter, and management warned they could decline by a low double-digit percentage in the fourth quarter as Google search referrals fall by more than 1 million per week. Advertising revenue rose 54% to $847 million. Citizens sees the 2027 risk as Reddit having to raise user acquisition spending, and says data-licensing renewals are increasingly at risk.
Summary written by Upside AI from the original article. Read the source for full details.
Original headline: Citizens downgrades Reddit as Google’s AI search shift weighs on traffic
Read the original on Yahoo Finance ↗
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RedditGOOGLartificial intelligenceadvertising
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GOOGL
• NeutralAlphabet Inc. (Class A)
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Communication Services |
| Industry | Interactive Media & Services |
| Market cap | $4.0T |
| Close on 10/29/2026 | 283.75 |
| Change that session | -12.66% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
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